Centene 3Q profit jumps on premiums, membership

Centene's 3rd-quarter profit jumps on higher premiums, membership boost

• On 11:25 am EDT, Tuesday October 27, 2009

ST. LOUIS (AP) -- Health insurer Centene Corp. said Tuesday its third-quarter profit jumped 16.5 percent on premium rate increases, membership growth, and the addition of Arizona and Florida to its coverage area.

Centene earned $21.3 million, or 48 cents per share, up from $18.2 million, or 41 cents per share, in the year-ago period. Revenue rose 21 percent to $1.04 billion from $858.6 million.

Excluding its New Jersey health plan, which is now counted as a discontinued operation, the company said it earned 51 cents per share from continuing operations.

Analysts polled by Thomson Reuters expected profit of 50 cents per share on revenue of $1.02 billion. Analyst estimates typically exclude special items.

The company's health benefits ratio -- or the percentage of premium revenue spent on medical costs -- rose slightly to 83.7 percent from 82.2 percent. Managed care membership rose 23.4 percent to 1.5 million, with strong boosts coming from the addition of the Arizona and Florida markets.

Looking ahead, the company boosted its full-year profit outlook to between $1.91 and $1.97 per share, up from prior guidance of $1.88 to $1.96 per share. The company expects revenue between $3.85 billion and $3.9 billion.

Analysts forecast profit of $1.92 per share on revenue of $4.03 billion.

Shares of Centene rose $1.22, or 7 percent, to $18.56 in morning trading. The stock has traded between $15 and $22.50 over the last 52 weeks.

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